The performance of German water utilities: a (semi)-parametric analysis |
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Authors: | Michael Zschille |
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Institution: | DIW Berlin – German Institute for Economic Research, Graduate Center of Economic and Social Research , Mohrenstrasse 58, Berlin D-10117, Germany |
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Abstract: | Germany's water supply industry is characterized by a multitude of utilities and widely diverging prices, possibly resulting from structural differences beyond the control of firms’ management, but also from inefficiencies. In this article, we use Data Envelopment Analysis and Stochastic Frontier Analysis to determine the utilities’ Technical Efficiency (TE) scores based on cross-sectional data from 373 public and private water utilities in 2006. We find large differences in TE scores even after accounting for significant structural variables like network density, share of groundwater usage and water losses. |
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Keywords: | water supply technical efficiency data envelopment analysis stochastic frontier analysis structural variables bootstrap truncated regression |
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